In Pursuit of a New American Industrialism

High-End or Low-End: What Does Pittsburgh Need? And Who Should Pay for It?

Here we go again with the downtown housing. A few days back, the Post-Gazette was reporting that medium-range housing is what really needs government assistance.

While housing has helped to boost the fortunes of the Downtown district, it has been out of the reach of many people because of the price.

At the same time, Pittsburgh Downtown Partnership research has found a "tremendous demand" for a middle range that includes young professional housing and work-force housing, said Patty Burk, vice president of housing and economic development.

... Part of the problem in providing more affordable housing in downtowns, here and elsewhere, is the high cost of construction, which leads developers to focus on the high end to turn a profit. Lower pricing typically requires some form of subsidy.

Well, of course lower-end housing needs assistance. So why isn't there more of this money available for the working-class housing Pittsburgh so desperately needs? Um... from today's Post-Gazette:

Thursday's grand opening of Bedford Springs Resort marks a milestone in its $120 million rehabilitation, capping more than two decades of monumental efforts to revive the Bedford County mountain retreat.

It also represents one of the largest projects in Pennsylvania to take advantage of a federal tax credit program that has spurred nearly $300 million of investment in Pittsburgh the past decade.

Examples include Downtown's Renaissance Pittsburgh Hotel, Heinz Lofts on the North Side and the Armstrong Cork Factory, a $60 million project with three luxury apartment buildings that opened in May in the Strip District.

Three luxury apartment buildings? I thought that developers recouped the cost on those by charging more rent? Huh.

Maybe I am missing something, but it seems to me that the new middle-class housing proposal is plenty "big" to garner attention. Because it did, first of all. But look at the scale of it. The tax credits come in at more than $500,000. Not exactly squirrel feed.

It is also worth pointing out that there is more at stake here than "free" money from the federal government. Check the links. In addition to that specific program, these projects have garnered plenty of funds from the county, the URA and a host of other agencies that are a lot closer to home.

But all that aside, the question remains: Is it true that middle-class housing is exactly what downtown needs? Is it true that middle-class housing is uniquely deserving of tax breaks? Is it true that luxury condos are less deserving? If so, why didn't anybody bring that up when we were tossing millions of dollars at luxury condos?

If we would have gotten more "24-hour downtown" for our development dollars by subsidizing cheaper homes, what the hell were we doing? If developers can recoup their investment on luxury apartments by charging more for rent, why are we chipping in for Richie McRich's granite countertops?

Seeing that middle class people are more likely to live in smaller homes, couldn't we have packed more people into downtown by focusing on less-palatial digs?

And what is all this talk about "the market"? We keep hearing about soaring demand and how people are just ga-ga over the Golden Triangle. Then we find out that no one will live there unless the government sweetens the deal. Which seems to be equally true of luxury condos and middle-class housing.

So where's the market? Even our mayor, who makes close to $100,000 a year, says living downtown is too expensive. If he can't afford to live there, the richest people in the city can't afford to live there, and middle-class people can't afford to live there... Maybe it would be better for people to live in Bloomfield and Shadyside and the city's other 86 neighbrhoods. Instead of contriving the 89th.

Would that be a horrific development? Well, no. Pittsburgh's downtown has HISTORICALLY been devoid of a residential component.
People didn't flee the Golden Triange because of cars and white flight and urban decay. They never lived there in the first place.

I have no problem with people living there now. Heck, I think it makes sense. But I do take issue with monthly announcements that Project X is uniqely qualified for government support, only to find out later that Project Y is really what needs help, because Project X is what the market actualy does best.